City’s TIF take rises, despite economic woes
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Despite a sour economy and crumbling real estate values, Chicago's take from its multitude of tax-increment financing districts is continuing to increase — prompting new calls for TIF reform.According to a report released Tuesday by Cook County Clerk David Orr, the amount of money raised by the city in 2009 from its 158 TIF districts increased 4.87%, to $520 million.
That property tax income, known as increment, was up in about two-thirds of city TIF districts, even though property values in many portions of the city and economy are declining.
Mr. Orr immediately seized on the report to call for big changes in TIF policy, which has become a major issue in the race for mayor.
"TIFs were not created to be a safety net when the economy went sour," Mr. Orr said. "The TIF system is broken and it needs to be fixed."
Mr. Orr did not say why the city's increment has grown, but there were five new TIFs last year and some existing districts had new construction that yielded new taxes.
Mayor Richard M. Daley has jealously safeguarded the city's TIF take but under strong budget pressure this year agreed to draw down $180 million in unallocated "surplus." About $38 million of that will be used to balance the city's budget, with the remainder going to Chicago Public Schools and other taxing bodies.
Mr. Orr specifically called for a moratorium on any new TIF districts until a thorough review is conducted. He also wants future TIFs to better itemize their project goals, more transparency on finances and inclusion of TIF revenues and spending in the annual Chicago budget.
Almost all of the candidates for mayor have called for some level of TIF changes, with hopeful Rahm Emanuel, for instance, proposing to use some TIF reserves to hire new police, post TIF finances on the Internet and add TIFs to the city's annual budget.
Among other items on the county clerk's annual TIF report:
* Since 1986, more than $4.08 billion has been raised from city TIF districts, and $3.667 billion from TIF districts in suburban Cook County.
* While the city's TIF total was up last year, increment decreased 16%, to $320 million, in suburban Cook.
* The largest-producing Chicago TIFs are Near South ($63 million), LaSalle Central ($21 million) and Kinzie Conservation ($19 million). The largest city TIF, covering the central Loop area, expired last year.
* The largest suburban TIFs are Hoffman Estates-Sears ($26 million) and Glenview-Naval Air Station ($26 million).
* Total increment in the city exploded in the 2000s, moving from just under $100 million in 1999 to a half-billion dollars a year or more in each of the past four years.
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